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BSkyB: the BBC is not renewing its carriage deal worth £85m over five years

The BBC today effectively launched a competitive service to digital satellite broadcaster BSkyB in a move that will surprise the industry and appears to rupture the close relationship between the corporation and the Rupert Murdoch-controlled TV business.
The BBC director general, Greg Dyke, is not renewing its carriage agreement , worth £85m over five years, and as of May 30 the eight BBC channels will move to a signal on another satellite, Astra 2D, in order to extend the BBC's digital satellite reach.

As well as hurting it financially, the move is bound to anger the highly competitive Sky and leaves a question mark over the Freeview digital terrestrial partnership between the two TV companies.

By saying goodbye to Sky it would also appear the BBC is launching the first serious digital satellite competitor to the broadcaster since viewers will no longer need a Sky card to receive the channels.

"This is an important decision for the BBC, which will save a considerable amount of money. It will bring benefits to viewers and enable more of them to receive the BBC digital channel," said Mr Dyke.

The announcement completely ambushed BSkyB executives, who are said to be "furious" about the pre-emptive strike by Mr Dyke.

By moving the BBC channels, which are currently free but bundled with other encryted Sky services, the BBC said its signals will only reach the UK and therefore the current legal requirement to encrypt channels will no longer apply.

However, in a press release the corporation stressed that all current and future Sky subscribers will be able to receive all BBC channels.

The BBC has drawn a premature halt to the ongoing row over the amount it should pay to Sky to carry its channels by deciding to go it alone.

A Sky spokesman said the BBC had told the media before it had informed Sky and that it was studying the proposals before making a response.

For viewers the move means that for the first time they won't need access to the encrypted Sky system to be able to view BBC channels.

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How would you view BBC channels outside of the EPG environment owned by Sky??

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This makes it doubly difficult for us plasma owners not to pay a TV license. At least while they were encrypted, plasma owning dish-owners could dodge the license fee (assuming they weren't Sky subscribers).